Head-To-Head Review: Iamgold (NYSE:IAG) versus Avalon Rare Metals (OTCMKTS:AVLNF)

Iamgold (NYSE:IAG) and Avalon Rare Metals (OTCMKTS:AVLNF) are both materials companies, but which is the superior business? We will contrast the two companies based on the strength of their earnings, profitability, valuation, institutional ownership, analyst recommendations, risk and dividends.

Profitability

This table compares Iamgold and Avalon Rare Metals’ net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Iamgold	34.29%	28.65%	21.26%
Avalon Rare Metals	-10,843.52%	-11.10%	-10.24%

Risk and Volatility

Iamgold has a beta of 1.39, meaning that its stock price is 39% more volatile than the S&P 500. Comparatively, Avalon Rare Metals has a beta of 0.75, meaning that its stock price is 25% less volatile than the S&P 500.

Valuation & Earnings

This table compares Iamgold and Avalon Rare Metals”s top-line revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Iamgold	$2.85 billion	3.68	$664.40 million	$2.26	8.20
Avalon Rare Metals	$190,000.00	99.46	-$20.85 million	($118.88)	-0.03

Iamgold has higher revenue and earnings than Avalon Rare Metals. Avalon Rare Metals is trading at a lower price-to-earnings ratio than Iamgold, indicating that it is currently the more affordable of the two stocks.

Analyst Recommendations

This is a summary of current recommendations and price targets for Iamgold and Avalon Rare Metals, as reported by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Iamgold	1	2	6	1	2.70
Avalon Rare Metals	0	1	0	0	2.00

Iamgold currently has a consensus price target of $22.71, indicating a potential upside of 22.53%. Given Iamgold’s stronger consensus rating and higher probable upside, equities analysts clearly believe Iamgold is more favorable than Avalon Rare Metals.

Insider & Institutional Ownership

47.1% of Iamgold shares are held by institutional investors. 0.2% of Iamgold shares are held by company insiders. Comparatively, 2.4% of Avalon Rare Metals shares are held by company insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a stock is poised for long-term growth.

Summary

Iamgold beats Avalon Rare Metals on 12 of the 14 factors compared between the two stocks.

About Iamgold

IAMGOLD Corporation is a Canadian gold mining company that explores for, develops and operates mineral properties. Its business is focused primarily on producing gold, with operations in Canada and Burkina Faso. The company’s assets include the Côté Gold mine in Ontario, the Westwood mine in Quebec and the Essakane mine in Burkina Faso. IAMGOLD also conducts exploration and development work to support its operating mines and assess potential mineral resources. Founded in 1990, IAMGOLD has built a portfolio spanning North America and West Africa.

About Avalon Rare Metals

Avalon Advanced Materials Inc., formerly known as Avalon Rare Metals Inc., is a Canadian mineral development company focused on critical minerals and materials used in clean energy, advanced technology and other industrial applications. The company’s activities center on the exploration, evaluation and advancement of mineral properties rather than the operation of large-scale producing mines. Avalon’s principal asset is the Separation Rapids Lithium Project near Kenora, Ontario. The project is designed to support the potential production of lithium minerals and other specialty materials for applications including lithium-ion batteries, glass and ceramics.